Daily Archives: Jan 9, 2018 at 07:53 am EST

How Long Will The Stock Market’s Low-Volatility Regime Last?

US stocks ticked up to another record close yesterday (Jan. 8) – the fifth consecutive trading day with a new high, based on the S&P 500 Index. For much of the last two years, in fact, equities been rising steadily and forging new peaks with remarkably low levels of volatility. How long can the calm endure? No one knows, but it’s a safe bet that at some point the market’s tranquility will end. Low-vol regimes aren’t unusual for the stock market, but they come with a limited shelf life. What are the warning signs that will signal regime shift? Let’s consider some possibilities, including a pair of metrics to monitor the trend that may help us decide when the jig is up.
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Macro Briefing: 9 January 2018

North Korea and South Korea hold first meeting in two years: CNN
A US government shutdown is a rising risk: Fiscal Times
Trump administration orders nearly 200,000 Salvadorans to leave US: Fox
Special counsel Mueller expected to request interview with Trump: CNN
Regulators nix Energy Secretary’s plan to prop up coal and nuclear plants: The Hill
Outstanding credit card debt in US reached a record in Nov: USA Today
Is Wall Street’s euphoria a contrarian indicator? Bloomberg
China reportedly orders reduction of cryptocurrency mining: TechCrunch
Annual growth for US commercial & industrial lending ticks below 1%: St Louis Fed